Fitch Affirms American Tower Secured Revenue Notes, Series 2015-1A and 2015-2A

CHICAGO--(BUSINESS WIRE)-- Fitch Ratings has affirmed GTP Acquisition Partners I, LLC's American Tower secured revenue notes commercial mortgage pass-through certificates, series 2015-1A and 2015-2A as follows:

--$350 million 2015-1A class at 'AAAsf', Outlook Stable;

--$525 million 2015-2A class at 'AAAsf', Outlook Stable.

KEY RATING DRIVERS

The affirmations are due to the stable performance of the collateral since issuance. In addition to low leverage, Fitch's ratings of 'AAAsf' for this transaction are a result of exceptionally strong tenant, collateral, portfolio, sponsorship, and transaction attributes. Consistent with Fitch's published U.S. wireless criteria for 'AAAsf' ratings, the debt is expected to fully amortize over the first 15 years of the transaction.

As of the April 2016 distribution date, the aggregate principal balance of the notes remains unchanged from issuance at $875 million. As part of its review, Fitch analyzed the financial and site information provided by the master servicer, Midland Loan Services. As of April 2016, aggregate annualized run rate net cash flow (NCF) increased 7.3% from issuance to $200.1 million with a Fitch stressed debt service coverage ratio (DSCR) increasing to 2.25x from 2.16x at issuance.

The tenant type concentration is stable. As of January 2016, total revenue contributed by telephony tenants was 92%. Lease revenues from telephony tenants have more stable income characteristics than other tenant types due to the strong end-use customer demand for wireless services.

The transaction is an issuance of notes backed by mortgages representing over 94% of the annualized run rate NCF and guaranteed by the direct parent of the borrowers. Those guarantees are secured by a pledge and first priority perfected security interest in 100% of the equity interest of the borrowers, which own or lease 3,605 wireless communication sites.

The series 2015-1A and series 2015-2A notes are interest-only until their respective anticipated repayment date (ARD). No other principal will be required to be paid prior to the ARD of the applicable series, which is in June 2020 for the 2015-1A class and June 2025 for the 2015-2A class. If the notes are not able to be refinanced on or prior to the ARD for that series, all excess cash flow will be swept to pay down the outstanding principal balance.

RATING SENSITIVITIES

The classes are expected to remain stable, and downgrades are unlikely based on continued cash flow growth due to annual rent escalations and automatic renewal clauses resulting in higher debt service coverage ratios since issuance. Additionally, cash flow continues to grow with the addition of new tenants to existing tower sites.

DUE DILIGENCE USAGE

No third party due diligence was provided or reviewed in relation to this rating action.

Additional information is available at www.fitchratings.com.

Applicable Criteria

Counterparty Criteria for Structured Finance and Covered Bonds (pub. 14 May 2014)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=744158

Criteria for Analyzing U.S. Wireless Tower Transactions (pub. 19 Nov 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=873961

Global Structured Finance Rating Criteria (pub. 06 Jul 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=867952

Related Research

American Tower Secured Revenue Notes (Series 2015-1 and 2015-2) -- Appendix

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=868651

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form

https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=1003642

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=1003642

Endorsement Policy

https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31

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View source version on businesswire.com: http://www.businesswire.com/news/home/20160429005814/en/

Fitch Ratings
Primary Analyst
David Ro
Director
+1-312-368-3132
Fitch Ratings, Inc.
70 West Madison St.
Chicago, IL 60602
or
Committee Chairperson
Mary MacNeill
Managing Director
+1-212-908-0785
or
Media Relations:
Alyssa Castelli, +1-212-908-0540
[email protected]
Elizabeth Fogerty, +1-212-908-0526
[email protected]

Source: Fitch Ratings

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